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          <td><DIV>
            <p><a href="SampleAnalysis.jsp">(Return to Sample Analysis page) </a></p>
            <p>This is the chapter which will give customers an overview of the
                recent financial performance of the industry sector or niche they
                have chosen. All the averages and trends evaluated for the group
                of companies featured in the report are stated in this chapter.
                There are three sets of results summarised:</p>
            <blockquote>
              <p><a href="#averages">The Industry Averages</a><br />
                  <a href="#rankings">The Industry Rankings</a><br />
                  <a href="#graphs">The Industry Graphs</a></p>
            </blockquote>
            <p>The bulk of the report analyses the latest results of the individual
              companies featured. Ratios and trends are drawn for each company
              and they are compared with the benchmark of the industry averages.
              This comparison gives the at-a-glance analysis in our graphs which
              is designed to ease the problem of making sense of so much financial
              data. In the Executive Summary we state what the averages actually
              are for the years covered by the report. We also show the stability
              and usefulness of the averages by illustrating their trend on graphs
              together with the statistical measure of standard deviation. </p>
          </DIV>            </td>
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	  <div id="greenBar">
	<h5><a name="averages"></a>Executive Summary - Averages </h5>
	  </div>
	  <table width="550" border="0" cellspacing="0" cellpadding="0">
	    <tr valign="top">
          <td><table cellpadding="0" cellspacing="0">
            <tr class="bold">
              <td style="width: 240px;"></td>
              <td style="width: 62px;">2005</td>
              <td style="width: 62px;">2006</td>
              <td style="width: 62px;">2007</td>
              <td style="width: 62px;">2008</td>
              <td style="width: 62px;">2009</td>
            </tr>
            <tr>
              <td>Gross Profit Margin (%)</td>
              <td>45.55</td>
              <td>48.11</td>
              <td>43.23</td>
              <td>48.66</td>
              <td>49.00</td>
            </tr>
            <tr>
              <td>Operating Margin (%)</td>
              <td>10.89</td>
              <td>9.56</td>
              <td>11.32</td>
              <td>11.00</td>
              <td>10.25</td>
            </tr>
            <tr>
              <td>Pre-tax Margin (%)</td>
              <td>8.99</td>
              <td>9.03</td>
              <td>8.55</td>
              <td>8.89</td>
              <td>9.06</td>
            </tr>
            <tr>
              <td>Return on Capital Employed</td>
              <td>14.73</td>
              <td>22.17</td>
              <td>25.28</td>
              <td>19.89</td>
              <td>23.00</td>
            </tr>
            <tr>
              <td>Return on Investment</td>
              <td>26.03</td>
              <td>30.45</td>
              <td>26.90</td>
              <td>35.03</td>
              <td>32.88</td>
            </tr>
            <tr>
              <td>Current Ratio</td>
              <td>1.34</td>
              <td>1.29</td>
              <td>1.25</td>
              <td>1.28</td>
              <td>1.31</td>
            </tr>
            <tr>
              <td>Debt Ratio</td>
              <td>0.69</td>
              <td>0.65</td>
              <td>0.66</td>
              <td>0.66</td>
              <td>0.64</td>
            </tr>
            <tr>
              <td>Stock Turnover (Per Year)</td>
              <td>15.68</td>
              <td>16.04</td>
              <td>15.52</td>
              <td>15.83</td>
              <td>14.69</td>
            </tr>
            <tr>
              <td>Average Credit Given (Days)</td>
              <td>70</td>
              <td>60</td>
              <td>63</td>
              <td>63</td>
              <td>65</td>
            </tr>
            <tr>
              <td>Average Credit Taken (Days)</td>
              <td>37</td>
              <td>54</td>
              <td>55</td>
              <td>52</td>
              <td>55</td>
            </tr>
            <tr>
              <td>Fixed Asset Turnover (Per year)</td>
              <td>5.95</td>
              <td>5.37</td>
              <td>4.95</td>
              <td>4.85</td>
              <td>5.23</td>
            </tr>
            <tr>
              <td>Debtor Turnover (Per Year)</td>
              <td>6.31</td>
              <td>6.60</td>
              <td>6.38</td>
              <td>6.33</td>
              <td>6.99</td>
            </tr>
            <tr>
              <td>Value Added (% of Turnover)</td>
              <td>-0.78</td>
              <td>1.68</td>
              <td>2.45</td>
              <td>1.79</td>
              <td>0.3</td>
            </tr>
            <tr>
              <td>Average Sales Per Employee (&pound;)</td>
              <td>85,580</td>
              <td>84,796</td>
              <td>84,428</td>
              <td>81,877</td>
              <td>77,670</td>
            </tr>
            <tr>
              <td>Average Wage Per Employee (&pound;)</td>
              <td>18,488</td>
              <td>16,995</td>
              <td>17,390</td>
              <td>18,127</td>
              <td>18,637</td>
            </tr>
            <tr>
              <td>Total Sales (% of Base Year)</td>
              <td>89.45</td>
              <td>94.32</td>
              <td>100</td>
              <td>101.35</td>
              <td>107.98</td>
            </tr>
            <tr>
              <td>Operating Profit (% of Base Year)</td>
              <td>121.95</td>
              <td>118.24</td>
              <td>100</td>
              <td>88.99</td>
              <td>100.15</td>
            </tr>
			<tr><a href="#top">Top of page</a></tr>
          </table></td>
	      </tr>
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	  <div id="greenBar">
	<h5><a name="rankings"></a>Executive Summary - Industry Rankings </h5>
	  </div>
	  <table width="550" border="0" cellspacing="0" cellpadding="0">
	    <tr valign="top">
          <td width="550"><p>This part of the executive summary offers an overview
              of the industry in terms of the best or worst companies by various
              financial measures. The firms are ranked using the latest year
              on record so this differs from the rankings chapter where the various
              figures for a particular year end are compared. The idea is to
              highlight the most important companies so as to assist with market
              share calculations for example. The various rankings relate to
              five classes of industry analysis:</p>
            <p class="subhead">:: Sales Analysis</p>
            <blockquote>
              <blockquote>
            <p><span class="boldGreen">The Largest Companies</span><br />
              Identifies the companies with the largest turnover in the industry and
                gives an idea of market concentration and market size. Market share data
                is difficult to compute since many companies are in several distinct
                sectors or because in some sectors there are many small companies either
                not limited or not filing full accounting records. The ranking of the
                largest companies gives a feel for this important marketing data.<br />
                                <br />
                                <span class="boldGreen">The Fastest Growing Companies</span><br />
              Evaluates the companies whose turnover has grown the fastest in the last
              four years. The faster growth companies might be attractive take-over targets
              or else companies offering products to emulate if it is this which is fuelling
              their growth.<br />
                <br />
                <span class="boldGreen">The New Entrants to the Market</span><br />
              Lists the newly formed companies which are operating in the market. This
              might be important in protecting market share or in identifying new trends
              of customer behaviour if combined with knowledge of the product lines being
              offered.</p>
            </blockquote>
              </blockquote>
            <p class="subhead">:: Profit Analysis</p>
            <blockquote>
              <blockquote>
                    <p><span class="boldGreen">The Most Operating Profit</span><br />
                      Identifies the companies with the highest operating profit in the industry.
                        Operating Profit is used since it is less variable than Pre-tax Profit
                        due to the omission of Extraordinary Items. Screening criteria for a
                        take-over for example might be that the company should be generating
                        profits of a particular level.<br />
                        <br />
                        <span class="boldGreen">The Fastest Growing Operating Profit</span><br />
                      Evaluates the companies whose operating profit has grown the fastest in
                      the last four years. The faster growth companies might be attractive take-over
                      targets or else companies offering products to emulate if it is this which
                      is fuelling their growth.<br />
                      <br />
                      <span class="boldGreen">The Least Operating Profit</span><br />
                      Lists the firms ranked by operating profit but sorted so that the biggest
                      loss comes highest on the listing. Periodically companies might need restructuring
                      or re-financing this listing might be a good way to identify companies
                      that might require his sort of attention. This would also be valuable information
                      as to the overall attractiveness of the industry. </p>
                    </blockquote>
              </blockquote>
            <p class="subhead">:: Investor Analysis</p>
            <blockquote>
              <blockquote>
                            <p><span class="boldGreen">The Most Value Added</span><br />
                              Identifies the companies which add the most value in the course of their
                                operations. We are talking here of the value created in terms of profit
                                and are taking into consideration the assets which the business is employing
                                to generate the profit. Value is added if the company is generating more
                                enough profit to pay a reasonable rate of return on all these assets.
                                It would therefore be possible for a profitable company to be destroying
                                value in its operations if it was inefficiently using its resources.
                                The figure itself is not important but the magnitude and sign is. <br />
                                <br />
                                <span class="boldGreen">The Greatest Return on Equity</span><br />
                              The return on equity is a measure of the attractiveness of the share holding
                              in a particular company. We are looking at the total of shareholders funds. <br />
                              <br />
                              <span class="boldGreen">The Least Value Added</span><br />
                              Firms which have negative value added figures are those which are either
                              making a loss or those which are making insufficient profit given the resources
                              they are employing. Over time the value of the company is eroded in this
                              way since it is not an economic proposition to continue doing business
                              in this way.</p>
                            </blockquote>
              </blockquote>
            <p class="subhead">:: Management Analysis</p>
            <blockquote>
              <blockquote>
                              <p><span class="boldGreen">The Greatest Return on Capital Employed</span><br />
                                Identifies the companies which have the highest percentage return on the
                                  capital they employ in the course of their operations. In a sense this
                                  is a measure of management efficiency since the decision to buy or lease,
                                  rent or own is within their remit. These decisions will impact the return
                                  on capital employed.<br />
                                <br />
                                <span class="boldGreen">The Biggest Cash Balances</span><br />
                                A listing of companies by cash balance will tend to be volatile from year
                                to year. Generally speaking more liquidity is better than less. Opportunities
                                can be taken advantage of quickly and there is less risk of default for
                                the creditors. Too much cash however might be a bad thing since the return
                                on cash is relatively low and it will reduce the overall return on capital
                                employed. A company with cash in the bank might also make itself an attractive
                                take-over target.<br />
                                <br />
                                <span class="boldGreen">The Most Investment in Plant &amp; Machinery</span><br />
                                Investment in fixed assets will generally strengthen the Balance Sheet
                                of a firm and increase the potential for borrowing. In terms of types of
                                asset, the investment in plant & machinery implies the continued determination
                                  to stay up to date and since new manufacturing machinery tends to be more
                                  productive than old it also boosts potential future returns so this is
                              a useful measure of management intentions. </p>
                            </blockquote>
              </blockquote>
            <p class="subhead">:: Financial Stability Analysis</p>
            <blockquote>
              <blockquote>
                    <p><span class="boldGreen">The Most Financially Stable</span><br />
                                Financial stability can be defined in a number of ways. We have chosen
                                  to define it in relative terms using a combined ranking of current ratio,
                                  quick ratio and debt ratio. In our measure the companies which fall in
                                  the top third of the industry for current ratio and quick ratio as well
                                  as the lowest third for debt ratio will be considered the most stable.
                                  We are not suggesting the companies are stable in absolute terms only
                                  that relative to their immediate industry competitors they are more or
                                  less stable i.e. the whole industry might be in trouble such as if you
                                  were in the steam car industry.<br />
                                <br />
                                <span class="boldGreen">The Most Improved Financial Stability</span><br />
                                These companies will have a relatively low position in terms of current
                                ratio or quick ratio and/or a relatively high debt ratio historically.
                                Over the last three years these measures will have improved in relative
                                terms.<br />
                                <br />
                                <span class="boldGreen">The Firms with Worsening Financial Stability</span><br />
                                Again this is a relative measure so for example a firm which had a very
                                high current ratio in historic terms which has now declined to industry
                                average levels recently might be featured. The ranking simply points out
                                relative declines in financial stability rather than in absolute levels.
                                This is a very useful indicator of company performance and financial riskiness
                              when used in conjunction with the industry averages. </p>
                </blockquote>
            </blockquote>            <p>Thus for example the Investor Analysis seeks to identify the best
              companies to own from the point of view of an investor, while the
              Financial Stability Analysis might be of more direct interest to
              lenders. </p></td>
	      </tr>
		  <tr><a href="#top">Top of page</a></tr>

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	  <div id="greenBar">
	<h5><a name="graphs"></a>Executive Summary - Graph Details</h5>
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	    <tr valign="top">
          <td colspan="3">A major part of the analysis of company performance
            relates to financial ratios. Ratios are useful in that they allow
            the comparison of companies of different sizes. A ratio is however
            only part of the story, of crucial importance is the trend of the
            ratio over time. In our reports trends are shown using graphs. The
            graphs allow the comparison of company performance with industry
            average performance since the industry average for the same period
            is also illustrated. Using this benchmark it is simple to determine
            whether a company is better of worse than average by being above
            or below this benchmark line.<br />
                <span class="bold"><br />
    The best way to observe trends and compare with a benchmark is by using graphs
    so this makes up a major part of our analysis. The following graphs are drawn
    for each company:</span></td>
	      </tr>
	    <tr valign="top">
          <td colspan="3">&nbsp;</td>
          </tr>
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          <td width="249"><p><span class="boldGreen">Industry Average Gross<br>
          Profit
                  Margin (%) </span><span class="bold"> -</span> the graph shows
                  the trend in gross margin through the period. Note in this
                  example the standard deviation (SD) is small this means most
                  of the companies have a value of gross margin close to the
                  average so this would be a good benchmark.<br>
                <img src="../spacer.gif" width="249" height="10"></p>
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          <td>&nbsp;</td>
          <td>&nbsp;</td>
          <td>&nbsp;</td>
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          <td>&nbsp;</td>
          <td><p><span class="boldGreen">Industry Average Operating<br>
    Profit Margin (%)</span> - the graph shows the trend in
    operating profit through time. Note in this example the standard deviation
    (SD) is a larger this means that the benchmark average is less representative
    of the companies. Again most of the values fall within plus and minus one
    standard deviation but the band this forms is wider since there is more variance.<span class="boldGreen"><br>
          </span></p>
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          <td>&nbsp;</td>
          <td><span class="boldGreen">Industry Average Stock Turnover -</span> the graph shows the trend in
            industry average stock turnover. Note that the size of the standard
            deviation (SD) increases substantially in the last year. This might
            be caused by having fewer observations if few companies have filed
            the necessary data when the graph is drawn. This has implications
            for the turnover analysis graph which seeks to estimate turnover
            using the industry average stock turnover and the balance sheet of
            a firm filing only modified accounts.</td>
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          <td>&nbsp;</td>
          <td><span class="boldGreen">Industry Average Wage Per Employee -</span> the graph shows the trend
            in average wage. Note that this graph example shows stable results
            (there are no big jumps in values of averages or large standard deviations).
            It would be fair to say wages are falling in most firms in this example
            industry.</td>
        </tr>
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          <td>&nbsp;</td>
          <td>&nbsp;</td>
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          <td>&nbsp;</td>
          <td><span class="boldGreen">Total Sales (% of Base Year Sales) -</span> This is a key graph since
            it shows whether an industry in growing or declining. It also shows
            in conjunction with a companies results whether the company is gaining
            market share. The example shows an industry which uses 2003 as the
            base year. This example shows turnover has been growing since 2000
            but has remained constant between 2003 and 2005.</td>
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          <td>&nbsp;</td>
          <td><span class="boldGreen">Total Operating Profit (% of Base Year
              Operating Profit) -</span> This
            is a key graph since it shows the relative attractiveness of a particular
            industry sector. The example shows the industry has historically
            been more profitable than in recent years. This measure is subject
            to fairly wide variations since profit can be both positive and negative
            so the total in the base year might vary in magnitude between years.</td>
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          <td><span class="boldGreen">Industry Average Return on Capital Employed
              -</span> the trend in average
            capital employed. Note in this example there is considerable variance
            of rate of return this can happen when values can be both positive
            and negative. The average is rising but there are many companies
            with higher and lower values than average.</td>
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          <td>&nbsp;</td>
          <td><span class="boldGreen">Industry Average Return on Investment -</span> the trend in average return
            on shareholder funds. Note in this example the band either side of
            the average which contains the majority of individual company observations
            is small. This implies a stable average and is very representative
            when used as a benchmark.</td>
        </tr>
        <tr valign="top">
          <td>&nbsp;</td>
          <td>&nbsp;</td>
          <td>&nbsp;</td>
        </tr>
        <tr valign="top">
          <td colspan="3">We calculate averages for a five year period since
            companies do not have the same yearend. Each company page shows the
            latest four years on record for that particular company and the relevant
            four years of industry average benchmark. </td>
          </tr>
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